Viacom to Sell Part of Simon & Schuster
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NEW YORK — In an effort to focus on its burgeoning entertainment businesses, Viacom Inc. is selling part of the Simon & Schuster publishing company to British media group Pearson for $4.6 billion.
Viacom will retain the company’s consumer publishing business, including the prestigious Simon & Schuster name. That division has published many recent bestsellers and has had successful tie-ins with other Viacom products, including books based on “Star Trek” and Nickelodeon’s popular “Rug Rats.”
The sale of Simon & Schuster’s educational, professional and reference publishing business allows Viacom to focus on its faster-growing entertainment businesses, which include interests in broadcast television, the Blockbuster video store chain and in cable’s MTV, VH-1, Nickelodeon and Showtime networks.
Pearson has agreed to sell the professional and reference publishing business to the U.S. investment firm Hicks, Muse, Tate & Furst for $1 billion, and it plans to keep the educational publishing business.
London-based Pearson already owns an educational publisher, Addison Wesley Longman. Pearson also owns the Financial Times newspaper, the Penguin publishing house, and 50% of Economist Group, which publishes The Economist, a respected weekly magazine.
Viacom Chairman Sumner M. Redstone called the sale “an extremely important step in our strategic goal to become and entertainment-driven enterprise.” Viacom said it would use the net proceeds from the transaction, which are expected to amount to about $3.8 billion, to pay off debt.
Viacom’s consumer publishing business puts out more than 2,100 titles annually under the Simon & Schuster name as well as Scribner, Pocket Books, Touchstone and MTV books.
The sale reflects increasing interest in U.S. publishing companies by foreign investors. In March, German media group Bertelsmann bought the biggest U.S. publisher, Random House. The price was not disclosed, but reports put the value of the deal between $1.2 billion and $1.6 billion.
Bertelsmann has been expanding its English-language publishing business since buying Bantam Books in 1977.
Its imprints also include Doubleday, Dell-Delacorte and Broadway Books.
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